Fort Bonifacio Development Corp. v. Commissioner of Internal Revenue

SPECIAL EIGHTH DIVISION [CA-G.R. SP No. 76017. June 11, 2004.] FORT BONIFACIO DEVELOPMENT CORPORATION , petitioner , vs . COMMISSIONER OF INTERNAL REVENUE , respondent . D E C I S I O N VASQUEZ , JR . , J p : This is a Petition for Review of the Decision of the Court of Tax Appeals dated March 5, 2003, in C.T.A. Case No. 6149, entitled " Fort Bonifacio Development Corporation vs. Commissioner of Internal Revenue ." The facts of the case are ably stated in the said decision. We quote: "Petitioner is a domestic corporation duly registered and existing under Philippine laws, with office address at Bonifacio Global City, Fort Bonifacio, Taguig, Metro Manila. Petitioner was originally incorporated as a wholly owned subsidiary of the Bases Conversion and Development Authority ("BCDA") for the purpose of, among others, developing portions of Fort Bonifacio in accordance with the Fort Bonifacio Master Development Plan prepared by the BCDA. The BCDA, upon the other hand, is a wholly-owned government corporation created by Republic Act ('R.A.') No. 7227 for the purpose of accelerating the conversion of military reservations/camps, which include Fort Bonifacio, into alternative productive uses and rising funds through the sale of portions of said military reservations/camps in order to promote the economic and social development of the country in general. ( Paragraph 1.03, Stipulations of Facts, Documents and Issue ) On February 8, 1995, by virtue of R.A. No. 7227 and Executive Order No. 40, dated December 8, 1992, which was issued by the President of the Philippines to implement the provisions of Section 8 of R.A. No. 7227 authorizing the President to dispose of, among others, portions of Fort Bonifacio, the Republic of the Philippines ('Republic') sold, conveyed and transferred to Petitioner portions of Fort Bonifacio ('Subject Property') for a total consideration of P71,227,503,200.00. ( Paragraph 1.04, Stipulation of Facts, Documents and Issue ) On September 15, 1998, the office of Respondent Commissioner of Internal Revenue issued Letter of Authority No. 19135 authorizing the examination of Petitioner's books of accounts and other accounting records covering all internal revenue liabilities for taxable year 1995. ( Paragraph 1.09, Stipulation of Facts, Documents and Issues ) As a result of the investigation, Petitioner was assessed for deficiency documentary stamp tax ('DST') in the amount of P1,068,412,560.00 pursuant to a final notice of assessment covered by Assessment No. ST-DST-95-0131-99 dated December 10, 1999. The said assessment was received by Petitioner on December 27, 1999. ( Paragraph 1.09, Stipulation of Facts, Documents and Issues ) The deficiency DST was based on the sale of the Fort Bonifacio property by the Republic to Petitioner on February 8, 1995 which, according to the BIR, is subject to DST pursuant to Section 196 of the then National Internal Revenue Code ('NIRC') and BIR Ruling No. 34 (B) 000-00-19-95 dated February 13, 1495 ( Paragraph 1.10, Stipulation of Facts, Documents and Issues ) On January 6, 2000, or within the reglementary period, Petitioner administratively protested the said assessment by filing a request for reconsideration. ( Paragraph 1.11, Stipulation of Facts, Documents and Issues ) As of the date of the Petition in this case, Respondent had taken no action on Petitioner's administrative protest of January 6, 2000. ( Paragraph 1.14, Stipulation of Facts, Documents and Issues ) Petitioner's request for reconsideration was filed with the Respondent Commissioner on January 6, 2000 and the 180-day period provided for in Section 228 of the NIRC expired on July 4, 2000. Thus, Petitioner had 30 days from July 4, 2000, or up to August 3, 2000, within which to file an appeal with the Court of Tax Appeals. ( Paragraph 1.15, Stipulation of Facts, Documents and Issues ) True enough, Petitioner, on August 2, 2000 filed a Petition for Review with this Court praying for the cancellation of the final assessment notice covered by Assessment No. ST-DST-95-0131-99 dated December 10, 1999 issued by the Bureau of Internal Revenue against Petitioner and declaring that Petitioner is not liable to pay the assessed deficiency DST amounting to P1,068,412,560.00." ( CTA Decision, pp. 13; Rollo, pp. 222224 ). Ultimately, the Court of Tax Appeals ruled in favor of the Commissioner of Internal Revenue on March 5, 2003, dispositively declaring this wise: "WHEREFORE, in view of the foregoing, the instant Petition for Review is hereby DENIED for lack of merit. Petitioner is hereby ORDERED to PAY the amount of P1,068,412,560.00 representing the deficiency documentary stamp tax for the year 1995. SO ORDERED." ( CTA Decision p. 16; Rollo, p. 237 ) Fort Bonifacio Development Corporation (FBDC, for brevity) now challenges the said decision on the following ascribed errors: "A. THE COURT OF TAX APPEALS ERRED IN HOLDING THAT THE TRANSACTION IN QUESTION IS SUBJECT TO DOCUMENTARY STAMP TAX UNDER SECTION 196 OF THE OLD NATIONAL INTERNAL REVENUE CODE, NOTWITHSTANDING THAT SAID TRANSACTION IS COVERED BY A SPECIAL PATENT ISSUED BY THE GOVERNMENT, WHICH IS EXPRESSLY EXCLUDED FROM THE COVERAGE OF SECTION 196. B. THE COURT OF TAX APPEALS ERRED IN TREATING THE SPECIAL PATENT AND DEED OF SALE DISTINCTIVELY AND SEPARATELY FROM EACH OTHER. C. THE COURT OF TAX APPEALS ERRED IN NOT HOLDING THAT THE TRANSACTION IN QUESTION IS EXEMPT FROM ALL TAXES, INCLUDING DOCUMENTARY STAMP TAX, UNDER REPUBLIC ACT NO. 7917, WHICH AMENDED REPUBLIC ACT NO. 7227, THE BASES CONVERSION AND DEVELOPMENT ACT OF 1992, EXEMPTING THE PROCEEDS FROM THE SALE OF MILITARY CAMPS FROM ALL FORMS OF TAXES AND FEES. D. THE COURT OF TAX APPEALS ERRED IN HOLDING THAT DOCUMENTARY STAMP TAX IS PART OF THE EXPENSES WHICH WERE TO BE DEDUCTED FROM THE PROCEEDS OF THE SALE. E. THE COURT OF TAX APPEALS ERRED IN DISREGARDING THE SOCIAL AND ECONOMIC OBJECTIVES OF REPUBLIC ACTS NOS. 7227 AND 7917. F. THE COURT OF TAX APPEALS ERRED IN HOLDING THAT THE RELEVANT PROVISION OF REPUBLIC ACT NO. 7917 MAY NOT BE APPLIED RETROACTIVELY TO THE TRANSACTION IN QUESTION. G. THE COURT OF TAX APPEALS ERRED IN HOLDING THAT PETITIONER WAS A PRIVATE ENTITY AND IN NOT HOLDING THAT IT WAS A GOVERNMENT ENTITY AT THE TIME OF THE TRANSACTION IN QUESTION, AND THEREFORE EXEMPT FROM TAX, BECAUSE IT WAS A WHOLLY-OWNED SUBSIDIARY OF THE BASES CONVERSION AND DEVELOPMENT AUTHORITY, A GOVERNMENT ENTITY. H. THE COURT OF TAX APPEALS ERRED IN APPLYING TO PETITIONER SECTION 173 OF THE OLD NATIONAL INTERNAL REVENUE CODE, WHICH PROVIDES THAT THE PARTY WHO IS NOT EXEMPT SHALL BE LIABLE FOR THE DOCUMENTARY STAMP TAX. I. THE COURT OF TAX APPEALS ERRED IN APPLYING THE RULE THAT STATUTES GRANTING TAX EXEMPTIONS ARE CONSTRUED STRICTISSIMI JURIS AGAINST THE TAXPAYER. J. THE COURT OF TAX APPEALS ERRED IN APPLYING THE PRESUMPTION IN FAVOR OF THE CORRECTNESS OF TAX ASSESSMENTS. K. THE COURT OF TAX APPEALS ERRED IN DISREGARDING THE WARRANTY OF THE REPUBLIC OF THE PHILIPPINES, OF WHICH THE BUREAU OF INTERNAL REVENUE ITSELF IS A PART, THAT NO TAXES ARE DUE AND OWING IN RESPECT OF THE TRANSFER OF THE SUBJECT PROPERTY IN FAVOR OF PETITIONER. L. THE COURT OF TAX APPEALS ERRED IN NOT HOLDING THAT THE ASSESSMENT AGAINST PETITIONER IS VOID. " (Petition, pp. 67; Rollo, pp. 1415) The petition is bereft of merit. Fundamental is the view that taxes are the lifeblood of the nation through which the government agencies continue to operate and with which the State effects its functions for the welfare of its constituents (C ommissioner of Internal Revenue vs. Court of Tax Appeals , 234 SCRA 348 [1994]). The primary purpose of taxes is to generate funds for the State to finance the needs of the citizenry and to advance the common weal ( Philippine Bank of Communications vs. Commissioner of Internal Revenue , 302 SCRA 241 [1999]) and so should be collected without unnecessary hindrance ( Philex Mining Corporation vs. Commissioner of Internal Revenue , 294 SCRA 687 [1998]). Likewise entrenched in our jurisprudence is the doctrine that a tax cannot be imposed unless it is supported by clear and express language of a statute ( Atlas Consolidated Mining and Development Corporation vs. Commissioner of Internal Revenue , 295 SCRA 721 [1998]). This is so because taxes, being burdens, are not to be presumed beyond what the applicable statute expressly and clearly declares tax statutes being strictissimi juris against the government ( Province of Bulacan vs. Court of Appeals , 299 SCRA 442 [1998]). Equally settled, too, is the rule that tax statutes are to receive a reasonable construction with a view of carrying out their purposes and intent. They should not be construed as to permit the taxpayer to easily evade the payment of the tax ( Commissioner of Internal Revenue vs. Court of Appeals , 242 SCRA 289 [1995]). Aptly so, once a tax is unquestionably imposed, a claim for exemption from tax payments must be clearly shown and based on language in the law too plain to be mistaken ( Davao Gulf Lumber Corporation vs. Commissioner of Internal Revenue , 293 SCRA 76 [1998]). Laws granting exemption from tax are construed strictissimi juris against the taxpayer and liberally in favor of the taxing power. Taxation is the rule and exemption is the exception. The law does not look with favor on tax exemptions and he who seeks to be thus privileged must justify it by words in the law too categorical to be misinterpreted (Sea-Land Service, Incorporated vs. Court of Appeals, 357 SCRA 441 [2001]). Guided by the foregoing principles, We now resolve the instant petition by addressing two focal questions, to wit: 1. Is there a law mandating the tax levied against petitioner? 2. Is petitioner exempted from paying the tax assessed against it? Be it remembered that the subject documentary stamp tax is being levied on the Deed of Absolute Sale with Quitclaim entered into by the Republic of the Philippines and FBDC ( Rollo , pp. 102105). Undoubtedly, such levy is sanctioned by the National Internal Revenue Code (NIRC), as amended by Republic Act No. 7660 (enacted on December 23, 1993) then in effect at the time of the execution of the said deed, which provides: "SEC. 173. Stamp taxes upon documents, instruments, loan agreements, and papers . Upon documents, instruments, loan agreements, and papers, and upon acceptances, assignments, sales, and transfers of the obligation, right, or property incident thereto , there shall be levied collected and paid for, and in respect of the transaction so had or accomplished the corresponding documentary stamp taxes prescribed in the following sections of this Title, by the person making, signing, issuing, accepting, or transferring the same wherever the document is made, signed issued accepted or transferred when the obligation or right arises from Philippine sources or the property is situated in the Philippines, and at the same time such act is done or transaction had: Provided, That whenever one party to the taxable document enjoys exemption from the tax herein imposed, the other party thereto who is not exempt shall be the one directly liable for the tax. " (Emphasis and Italics, Ours) "Section 196. Stamp tax on deed of sale and conveyance of real property . On all conveyance, deeds, instruments, or writings, other than grants, patents, or original certificates of adjudication issued by the Government , whereby any lands, tenements or other realty sold shall be granted, assigned, transferred, or otherwise conveyed to the purchaser, or purchasers, or to any other person or persons designated by such purchaser or purchasers, there shall be collected a documentary stamp tax of the following rates : (a) When the consideration, or value received or contracted to be paid for such realty, after making proper allowance of any encumbrance, does not exceed one thousand pesos, Fifteen pesos (P15.00). (b) For each additional one thousand pesos, or fractional part thereof in excess of one thousand pesos of such consideration or value, Fifteen pesos (P15.00). When it appears that the amount of the documentary stamp tax payable hereunder has been reduced by an incorrect statement, of the consideration in any conveyance, deed, instrument, or writing subject to such tax the Commissioner, provincial or city treasurer, or other revenue officer from the assessment rolls or other reliable source of information, assess the property of its true market value and collect the proper tax thereon." (Emphasis and Italics, Ours) Apropos, the documentary stamp tax may be imposed on all deeds, instruments, writings, or conveyances of real property. The only exception is when such conveyance or transfer is effected by way of a grant, patent, or original certificate of adjudication issued by the Government. FBDC nevertheless contends that the subject transaction is exempt from the imposition of the documentary stamp tax as provided by Section 196 of the law cited earlier since the transfer and conveyance of the property effected thereby was actually implemented by way of the issuance of Special Patent No. 3596 issued by the Government. What was registered in the Registry of Deeds is the special patent which was the operative act that conveyed the subject property. Petitioner further argues that the Deed of Absolute Sale with Quitclaim was an integral part of and a mere confirmation of the special patent. Such theory is erroneous. We have read the provisions of the said Special Patent No. 3596 and found that the patent was issued pursuant to the authority granted to the President by Republic Act No. 7227 . The Special Patent declares: "WHEREAS, Section 8 of Republic Act 7227 , authorizes the President to dispose of the subject land covered by said Republic Act, proceeds of which shall form part of the capitalization of BCDA" (Emphasis, Ours) Section 8 of the said R.A. 7227 , on the other hand, provides: ". . . The President is hereby authorized to sell the above lands, in whole or in part, which are hereby declared alienable and disposable pursuant to the provisions of existing laws and regulations governing sales of government properties : . . ." (Emphasis and Italics, Ours) Two facts are immediately apparent from the foregoing provisions. First , the subject public land was declared alienable and disposable pursuant to the provisions of existing laws and regulations governing sales of government properties. Second , the law clearly intended the land to be conveyed by a sale entered into by the President and not just by the mere issuance of a patent. Nowhere in the said Republic Act No. 7227, Republic Act No. 7917 (which amended certain provisions of R.A. 7227 ), or their implementing Policies and Guidelines ( Executive Order Nos. 40 and 62 ) is it provided that the subject land may be conveyed by way of a special patent. The cited laws specifically mandate the sale as the principal mode of disposing or alienating the subject land. This would explain why the Deed of Absolute Sale with Quitclaim provides: "1. For and in consideration of the total amount of SEVENTY ONE BILLION TWO HUNDRED TWENTY SEVEN MILLION FIVE HUNDRED THREE THOUSAND AND TWO HUNDRED PESOS (P71,227,503,200.00), Philippine Currency (the Purchase Price), the Seller hereby irrevocably and absolutely sells, conveys and transfers the Subject Property, in favor of the Buyer subject to the succeeding paragraph . xxx xxx xxx 4. To implement the transfer and registration of the Subject Property in the name of the Buyer, the Seller has issued, or shall hereafter cause to be issued, a Special Patent which will absolutely and irrevocably grant and convey the legal and beneficial title to the Subject Property to and in favor of the Buyer." ( Rollo , p. 103; Emphasis and Italics, Ours) The Deed of Absolute Sale with Quitclaim is thus not a simple " surplusage " or " confirmation " of the issued patent as petitioner asseverates but is verily the main transaction or contract by which the Government conveyed certain portions of the military reservation known as Fort Bonifacio to the petitioner. It is the issuance of the special patent which appears to be a mere condition or provision of the principal contract of sale between the Republic of the Philippines and FBDC. The fact that the special patent was issued one day ahead of the execution of the Deed of Absolute Sale with Quitclaim is of no moment since, as the subject Deed itself specifically provides, the special patent was only issued to ". . . implement the transfer and registration of the Subject Property in the name of the Buyer . . ." ( Rollo , p. 103). Moreover, R.A. 7227 declared the subject land alienable and disposable pursuant to the provisions of existing laws and regulations governing sales of government properties. Special Patent No. 3596 specifically declared as well that the ". . . tracts of land of the public domain . . . " that was part of Fort Bonifacio was granted and conveyed in conformity with Executive Order No. 40 , dated December 8, 1992 and Commonwealth Act No. 141 , otherwise known as the Public Land Act ( Rollo , p. 107). Section 107 of the Public Land Act provides that all patents and certificates for land granted under the said Act ". . . shall be effective only for purposes defined in Section 122 of the Land Registration Act , and actual conveyance of the land shall be effected only as provided in said Section." Section 122 of the Land Registration Act , in turn, provides: "Whenever public lands in the Philippine Islands belonging to the Government of the United States or to the Government of the Philippine Islands are alienated, granted, or conveyed to persons or to public or private corporations, the same shall be brought forthwith under the operation of this Act and shall become registered lands. It shall be the duty of the official issuing the instrument of alienation, grant, or conveyance in behalf of the Government to cause such instrument before its delivery to the grantee, to be filed with the register of deeds for the province where the land lies and to be there registered like other deeds and conveyances, whereupon a certificate shall be entered as in other cases of registered land, and on owner's duplicate certificate issued to the grantee. The deed, grant, or instrument of conveyance from the Government to the grantee shall not take effect as a conveyance or bind the land, but shall operate only as a contract between the Government and the grantee and as evidence of authority to the clerk or register of deeds to make registration . The act of registration shall be the operative act to convey and affect the lands , and in all cases under this Act registration shall be made in the office of the register of deeds for the province where the land lies. The fees for registration shall be paid by the grantee. After due registration and issue of the certificate and owner's duplicate, such land shall be registered land for all purpose under this Act." (Italics and Emphasis, Ours) Hence, the special patent issued by the Government did not take effect as a conveyance nor did it bind the land. It simply was intended to facilitate the registration of the property in question. Resultantly, the special patent was registered in the Registry of Deeds for the Province of Rizal and Original Certificate of Title No. SP-001 was issued in the name of FBDC ( Rollo , pp. 106113). This does not, however, make Special Patent No. 3596 a superior document than the Deed of Absolute Sale with Quitclaim . By acknowledging in its provisions that its grant was made pursuant to the Public Land Act , the special patent impliedly declared that the provisions of the law cited earlier shall limit its effectivity to that of being a mere evidence of authority for the register of deeds to make registration. Neither does it detract from the fact that the Deed of Absolute Sale with Quitclaim was the principal mode effected by the Government (consistent with what R.A. 7227 dictates) to dispose and alienate the subject parcel of land. What's more, by asserting its entreated exemption, the petitioner misses the point completely. Pursuant to Section 196 of the NIRC, the documentary stamp tax cannot be imposed on patents that convey lands to the grantee. Yet, as this disquisition has established, the patent issued in the instant case did not operate to convey the subject land to FBDC since the principal mode resorted to by the Republic of the Philippines to dispose of the subject land was by contract of sale. Besides, the documentary stamp tax is not being imposed on the patent itself but rather on the Deed of Absolute Sale with Quitclaim entered into by the Government and FBDC an imposition clearly mandated by existing tax laws. To Our minds, the protracted litigation of this case could have been avoided had petitioner realized the nature of the tax levied against it. In Philippine Home Assurance Corporation vs. Court of Appeals (301 SCRA 443 [1999]), the Supreme Court ruled that documentary stamp taxes are levied on the exercise by persons of certain privileges conferred by law for the creation, revision, or termination of specific legal relationships through the execution of specific instruments. Documentary stamp taxes are thus levied on the exercises of these privileges through the execution of specific instruments , independently of the legal status of the transactions giving rise thereto. In the same case, the High Court also declared citing Du Pont vs. United States (300 U.S. 150, 153 [1936]): " The tax is not upon the business transacted but is an excise upon the privilege, opportunity, or facility offered at exchanges for the transaction of the business . It is an excise upon the facilities used in the transaction of the business separate and apart from the business itself. " (Emphasis and Italics, Ours) Accordingly, the subject documentary stamp tax is being levied on the execution of the Deed of Absolute Sale with Quitclaim through which the herein parties' privilege to convey and transfer the land in the instant case was exercised, separate and apart from the circumstances and conditions related to such conveyance and transfer, including the special patent issued pursuant to the said Deed . The documentary stamp tax therefore must be paid upon the issuance of the specified instruments covered by the tax in the instant case, the Deed of Absolute Sale with Quitclaim ( Philippine Home Assurance Corporation vs. Court of Appeals, supra. ). The petitioner nonetheless asserts that ". . . the transaction subject of the instant case is exempt from all kinds of taxes, including the documentary stamp tax" (Petition, p. 26, Rollo , p. 34). Apparently, FBDC relies on Republic Act No. 7917 to support its premise. The provisions of the said law declares: "Section 1. Paragraph (d), Section 8 of Republic Act No. 7227, otherwise known as the Bases Conversion and Development Act of 1992, is hereby amended to read as follows: xxx xxx xxx . . . The proceeds from any sale, after deducting all expenses related to the sale , of portions of Metro Manila military camps as authorized under this Act, shall be deemed appropriated for the purposes herein provided for the following purposes with their corresponding percent shares of proceeds: xxx xxx xxx The provisions of law to the contrary notwithstanding, the proceeds of the sale thereof shall not be diminished and therefore, exempt from all forms of taxes and fees ." (Emphasis, Ours] The petitioner concludes that the phrase "proceeds of the sale" applies to the entire proceeds of the sale of the subject property in the amount of P71,227,503,200.00 realized by the Republic of the Philippines and that it was the intention of Congress to free the said proceeds from the taxes that would diminish the said proceeds. The imposition of the tax would result in a conversion of a portion of the proceeds of the sale from their intrinsic nature as funds appropriated for the purposes provided by R.A. 7917 to funds of the government disposable for aims different from what was intended by Congress. Again, the petitioner is mistaken. FBDC handily overlooks the first part of the amendatory law which says: " The proceeds from any sale , after deducting all expenses related to the sale , of portions of Metro Manila military camps as authorized in this Act, shall be deemed appropriated for the purposes herein provided . . . ". Evidently, the phrase " proceeds from any sale " does not mean to represent the entire purchase price of the land sold. To be more precise, the law clearly envisions the " proceeds from any sale " to be the remainder of the purchase price " after deducting all expenses related to the sale ", it is this residual proceeds that is deemed appropriated by the law for the purposes provided therein. It is this same net proceeds which " shall not be diminished and, therefore, exempt from all forms of taxes and fees ." Section 201 of the National Internal Revenue Code , as amended by R.A. 7660 , provides: "An instrument, document, or paper which is required by law to be stamped and which has been signed, issued, accepted or transferred without being duly stamped, shall not be recorded nor shall it or any copy thereof or any record of transfer of the same be admitted or used in evidence in any court until the requisite stamp or stamps shall have been affixed thereto and cancelled. No notary public or other officer authorized to administer oaths shall add his jurat or acknowledgment to any document subject to documentary stamp tax unless the proper documentary stamps are affixed thereto and cancelled." (Italics and Emphasis, Ours) Succinctly put, the payment of the required documentary stamp tax is essential for the Deed of Absolute Sale with Quitclaim to be recorded and used as a legal document. Fittingly deemed thus as an " expense related to the sale " of the subject land to FBDC, the documentary stamp tax may consequently be levied against petitioner without violating the provisions of Republic Act No. 7917 . Without doubt, what Congress exempted from all forms of taxes and fees under R.A. 7917 is the " proceeds of the sale " (which, as We have explained, refers to the remainder of the purchase price after deducting all expenses related to the said sale). Stated otherwise, the " proceeds of the sale " cannot be the subject of any form of tax or fee. Contrary to the asseverations of FBDC, the documentary stamp tax is not being levied against the transaction between the parties. Neither is it a tax on the " proceeds of the sale ". While the tax law refers to the consideration or the value received from the sale, it only does so for the purpose of computing the documentary tax due. We dare reiterate that the documentary stamp tax is being imposed on the execution of the Deed of Absolute Sale with Quitclaim through which the herein parties' privilege to convey and transfer the land in the instant case was exercised, separate and apart from the circumstances and conditions related to such conveyance and transfer. All told, the assessment of the documentary stamp tax on the Deed of Absolute Sale with Quitclaim is proper and called for. As readily admitted by the petitioner, the Republic of the Philippines, being the taxing authority, is exempted from paying the levied tax. It follows that the petitioner should pay the documentary stamp tax since Section 173 of the NIRC provides that ". . . whenever one party to the taxable document enjoys exemption from the tax herein imposed, the other party thereto who is not exempt shall be the one directly liable for the tax ." The said section also provides that the documentary stamp tax shall be levied, collected and paid for ". . . by the person making, signing, issuing, accepting, or transferring . . ." the document conveying the property incident thereto. Accordingly, petitioner may also be held liable for the tax as a signatory to the Deed of Absolute Sale with Quitclaim . FBDC argues, though, that it is exempt from any form of tax since it is a wholly owned subsidiary of the Bases Conversion and Development Authority (a government-owned corporation created by law). We do not think so. Noteworthy is that as early as June 11, 1984, Presidential Decree No. 1931 effectively withdrew all tax exemption privileges granted to government-owned or controlled corporations as stated in Section 1 thereof: "The provisions of special or general law to the contrary notwithstanding, all exemptions from the payment of duties, taxes, fees, imposts and other charges heretofore granted in favor of government-owned or controlled corporations including their subsidiaries, are hereby withdrawn. " (Emphasis and Italics, Ours) Executive Order No. 93 , enacted on December 17, 1986, restored certain exemptions provided under specified laws, one of which is the National Internal Revenue Code . The pertinent portion of the said law recites: "Section 1. The provisions of any general or special law to the contrary notwithstanding, all tax and duty incentives granted to government and private entities are hereby withdrawn, except: xxx xxx xxx e) those conferred under the four basic codes namely: (i) the Tariff and Customs Code, as amended; (ii) the National Internal Revenue Code, as amended; (iii) the Local Tax Code, as amended; (iv) the Real Property Tax Code, as amended." Given that the NIRC does not exempt government-owned or controlled corporations and their subsidiaries from the payment of documentary stamp tax, the petitioner cannot seek refuge from the tax as a subsidiary of a government-owned or controlled corporation. The provisions of P.D. 1931 are applicable against it. Justifying the underlying principle behind the said law, the High Court declared in Philippine Ports Authority vs. City of IIoilo (G.R. No. 109791, July 14, 2003) EATcHD ". . . the primary reason for the withdrawal of tax exemption privileges granted to government-owned and controlled corporations and all other units of government was that such privilege resulted in serious tax base erosion and distortions in the tax treatment of similarly situated enterprises , hence resulting in the need for these entities to share in the requirements of development, fiscal or otherwise, by paying the taxes and other charges due from them." (Emphasis, Ours) FBDC contends as well that the Republic of the Philippines, represented by then Executive Secretary Teofisto T. Guingona, Jr. who, in turn, was acting by the authority of President Fidel V. Ramos, warranted in the Deed of Absolute Sale with Quitclaim that "there are no real estate or other taxes, fees, assessments or charges which are due and owing on or in respect of the Subject Property or the transfer thereof in favor of the Buyer" ( Rollo , p. 104). The assurance cannot be used to avoid the payment of the documentary stamp tax. To begin with, by no stretch of the imagination can such warranty be interpreted as granting an exemption to petitioner from any form of tax including the one assessed against it. To allow this would be to violate Section 28(4), Article VI of the Constitution which provides that "No law granting any tax exemption shall be passed without the concurrence of a majority of all the Members of the Congress." The power to tax and to grant tax exemptions is vested in the Congress ( Chavez vs. Presidential Commission on Good Government, 299 SCRA 744 [1998]). Indeed, statutory exemptions are granted in the discretion of the legislature, not the executive department nor the courts. This is because tax exemptions should not be lightly extended since they will represent a loss of revenue to the government stressing even more the lifeblood doctrine expounded earlier. In addition, the warranty made by the Executive Secretary cannot prevent the collection of the tax imposed especially when neither the Secretary nor the President had the authority to make such warranty or extend such exemption. The Government can never be in estoppel, particularly in matters involving taxes. It is a well-known rule that erroneous application and enforcement of the law by the public officers do not preclude subsequent correct application of the statute, and that the government is never estopped by mistake or error on the part of its agents ( Philippine Basketball Association vs. Court of Appeals, 337 SCRA 358 [2000]). The errors of certain administrative officers should never be allowed to jeopardize the Government's financial position, especially in the case at bar where a billion pesos, the collection whereof if justified, stands to be prejudiced because of bureaucratic lethargy ( Commissioner of Internal Revenue vs. Court of Appeals, supra ). Petitioner then argues that the imposition of the documentary stamp tax would prove detrimental to the social and economic objectives sought to be attained by the government. Again, FBDC is mistaken. Section 2 of Republic Act No. 7227 or the Bases Conversion and Development Act of 1992 provides: "It is hereby declared the policy of the Government . . . to raise funds by the sale of portions of Metro Manila military camps, and to apply said funds as provided herein for the development and conversion to productive civilian use of the lands covered under the 1947 Military Bases Agreement between the Philippines and the United States of America, as amended. It is likewise the declared policy of the Government to enhance the benefits to be derived from said properties in order to promote the economic and social development of Central Luzon in particular and the country in general. " (Italics and Emphasis, Ours) Suffice it to say that the collection of the tax can be used for the furtherance of the law's objective of promoting social and economic development. What would be anathema to such objective is to allow FBDC to altogether avoid the payment of a valid tax worth over a billion pesos that could easily be used to "promote the economic and social development of Central Luzon in particular and the country in general." Curiously; Section 8 of R.A. 7227 , as amended by Section 1 of R.A. 7917 , earmarked the entire " proceeds of the sale " of portions of Metro Manila military camps like Fort Bonifacio, after deducting all expenses related to the sale, for purposes such as financing the modernization program of the Armed Forces of the Philippines, infrastructure of former U.S. military bases, the National Shelter Program, and other specified social and economic programs of the Government. Yet, based on the evidence adduced by petitioner itself, the BCDA assigned the entire purchase price of P71,227,503,200 to FBDC as payment for the former's stock subscription with the latter ( Rollo , p. 117). This is even detrimental to the social and economic objectives cited by petitioner since there is no evidence that the specified programs cited above received the exact percentage amount "of the proceeds of the sale" of portion of Fort Bonifacio that was specifically allotted for them by the law. IN VIEW OF ALL THE FOREGOING, the appealed decision is AFFIRMED in toto . No cost. SO ORDERED. De Guia-Salvador * and Reyes, JJ ., concur. Footnotes * Vice J . P. J. Trio Tirona per Office Order No. 159 dated May 28, 2004